Non-profits need solid legal advice to operate effectively

With the launch of the Parsus Non-profit Toolkit, we’ve been thinking about common misconceptions that many people have about setting up a non-profit. 

One of them? Many people believe that running a non-profit is easy if you have a group of passionate volunteers. 

While it’s true that you need people who believe in your cause to help you, you need more than passion and a group of friends who run it off the side of their desks at the end of the day. 

In truth, a non-profit needs nearly everything a for-profit company needs, as well as the need to stay in compliance with non-profit rules and regulations.

From a legal standpoint, the formation of a non-profit is very similar to the formation of a for-profit corporation with Secretary of State filings and governing documents prepared. There is an added layer of complexity, however, in that non-profits have to also file for (and maintain) their 501(c)3 tax status.

Once a nonprofit has been formed, it will also need the same ongoing legal support that other businesses have including employment agreements, nondisclosure and noncompete agreements, supplier and vendor agreements, lease agreements and more. 

A key thing to remember is that a new non-profit needs the same, if not more, level of legal maintenance as a for-profit company.

If you are launching a non-profit, or just thinking about it, and want solid legal advice on ensuring that it is set up to impact your community in a sustainable way, visit the Parsus Non-profit Toolkit.